TelferYoung (Taranaki) Limited

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Taranaki Newsletter - December 2008

16 December 2008

Rating Valuations - What They Really Are

Rating Valuations are produced for local councils to allow them to determine rates.  It seems there is a fundamental flaw in the public perception of the Rating Valuation and its purpose.  Although official documents describe the assessments as Rating Valuations, they are primarily produced so a local authority can establish some relativity between properties, and subsequently impose rates for each property.  The assessments are the outcome of a mass appraisal process, which may not capture particular redeeming features or flaws that would be considered in a market valuation.

Unfortunately there is a widespread mistaken belief that these assessments are a market valuation, identical to those carried out by registered valuers. While the rating work may be carried out, or be overseen by, registered valuers, the methods which are adopted to arrive at the rating assessment differ from those used when assessing the market value of an individual property. In Auckland for example, rates are based on how much a property would rent for, known as an annual value, while in the New Plymouth District rates are based on the land value with regional levies being set on the capital value. Stratford District Council and South Taranaki District Council also rate on capital value.

As a result of the mass appraisal technique used, and as only a proportion of properties are physically inspected, usually from the outside, inaccuracies can occur. A rating assessment should not be interpreted as a market valuation particularly in the present financial climate.

It cannot be repeated too often that the main purpose of the rating valuation assessment is to update the Local Authority roll which is used to allocate rates. While those undertaking the task endeavour to provide an assessment that reflects market trends, a major emphasis is put on achieving relativity between one property and another. Without full inspection it is not possible to make the required value adjustments for a number of factors, particularly interior quality and general presentation. Discrepancies between a rating valuation and a market valuation can therefore occur. Comparisons of actual property sales with the rating valuation assessments often show considerable variation so much so that in these uncertain times we would recommend that rating roll figures are not used for financial transactions of any significance. If you require a property valuation for financial purposes contact a Registered Valuer.

TelferYoung Taranaki is pleased to introduce two new appointments within their New Plymouth office.

Fintan McGlinchey 

Fintan McGlinchey has returned to Taranaki after eight years valuing in the Bay of Islands, undertaking a broad range of valuation assignments whilst there.   He joins TelferYoung (Taranaki) Ltd as a Registered Valuer specialising in rural, lifestyle and residential sectors.  Fintan graduated from Massey University in 2001 and has also spent time in London working as a property/project manager. Fintan, wife Catherine and daughter Hannah are enjoying the positive and friendly environment that New Plymouth provides as well as being closer to extended family and friends. They are already taking great pride in living in one of the worlds "best cities".  

Monique Burr

Monique has just joined us in a valuers position after gaining practical experience with us during university holidays. She is studying towards a Bachelor of Commerce majoring in valuation and property management at Lincoln University.

From New Plymouth, Monique went to Sacred Heart Girls College before going to university. Currently she is working towards registration and will be undertaking predominantly residential valuations as well as a range of commercial assignments. Monique is pleased to be back in Taranaki and is looking forward to taking advantage of the range of outdoor pursuits our province has to offer.

Back issues of the newsletter can be obtained from TelferYoung (Taranaki) Ltd
143 Powderham Street,
P O Box 713,
New Plymouth,
New Zealand.
email: taranaki@telferyoung.com

+ Mike Myers + Ian Baker + Adam Boon + Fintan McGlinchey + Monique Burr + John Larmer